First time home buyers
WE HAVE A MORTGAGE SOLUTION FOR YOUR UNIQUE SITUATION
YOU’VE BEEN WAITING. YOU’VE BEEN SAVING.
BUYING YOUR FIRST HOME CAN BE DAUNTING!
After all, a house is one of the biggest purchases you will ever make. Because of the cost and effort associated with the purchase of a home, you need to make sure that the decisions you make today, will not negatively affect your future. This is especially true if you plan to take out a first time home buyer loan.
Here are the most important considerations you need to make when thinking about buying your first house:
KNOW YOUR CREDIT LIMIT
Before you can qualify for any type of loan, including a mortgage, the bank or lending institution will check your credit score. To know your credit standing, contact Equifax, Experian, and TransUnion for your annual credit report. Check the report carefully and if you see any error, ask for a dispute form from the agency within 30 days of receiving the report.
PREPARE YOUR DOCUMENTS
For home loan applications, you need to prepare documents related to your income and taxes. In general, you will be required to present your W-2s for the last two years, tax returns, the past two months of bank statements, and 30 days worth of recent pay stubs.
ESTABLISH YOUR BUDGET
Before you even apply for a mortgage loan, you need to know how much you can afford to spend on your first home. A way to do this is to calculate your debt-to-income ratio and to factor in the down payment. While it is ideal for you to have no more than 29 percent of your gross monthly income going to housing cost, the percentages vary depending on the lender and loan program.
SAVE UP FOR THE DOWN PAYMENT
Some (not all) home purchases require that you pay a certain amount as down payment. Depending on the value of the house, it can be very difficult to scrape together enough money. As a general rule, save up as much as you can as soon as you decide to buy your first home.